Since he was forced to resign as chief of staff in the wake of the Second Lebanon War, Dan Halutz has been careful to avoid making binding political statements. He has given very few interviews, and most were related to the publication of his book on the war.

At the beginning of this week, Halutz participated in the final part of a simulation by the Interdisciplinary Center in Herzliya called "Iran, the Day After." The game posited three scenarios: In the first, Iran announces that it has nuclear weapons; in the second, Hezbollah attacks Israel and hits the defense establishment's Tel Aviv headquarters, the Kirya; and in the third, Israel learns that a suitcase filled with radioactive material has been smuggled into Lebanon from Iran.

Dan Halutz in 2006, during his tenure as IDF chief of staff.Ariel Jerozolimski

A large number of experts addressed these scenarios. The only one who slid into political-diplomatic matters was Halutz. Here is part of what he said: "We in Israel are fostering a doomsday scenario whereby the world will come to a halt if Iran goes nuclear. It will not come to a halt. I am not making light of a nuclear Iran, but it is also wrong to overstate the effects. There is no need to frighten a whole nation with Holocaust-like implications. We are not even close to the holocaust people are trying to conjure."

Addressing the person who played Israel's prime minister, Halutz said, "A proposal for diplomatic moves should not be drafted after two missiles hit the Kirya, but beforehand. One of the ways to handle the Iranians is to isolate them within the Muslim world, most of which is more disturbed than Israel by a nuclear Iran ... I recently met a senior Muslim official, who told me, 'If you were to accede even slightly to the Saudi [peace] plan, you would make peace with three states and get 19 for free.' That should be food for thought.

"It's necessary to create diplomatic isolation. For that, a yes-or-no decision needs to be made. All the files are ready. All that's needed is for someone to make a decision. The price tag is known. We have to know that if we decide no, we need to be ready, from now until eternity, to fight over the implications. I sometimes hear a halfhearted 'yes,' which contains more 'no' than 'yes.'

"I suggest that we remove the term 'red lines' from our lexicon, because at moments of truth it doesn't hold water. There is no need to define 'red lines.' We need to do what's right. If Syria is defined as a player in the Hezbollah-Iran axis, let's try to draw it away from that brick wall in order to weaken [the wall] ... Is that possible? I think it is ... In order to address the Iranian issue we have to look at the countries around us, and [around] them, and engage them, not repel them."

Referring to a scenario in which the Israeli government is discussing how to react to smuggled suitcases, Halutz asked, "How will the people sitting around the table, who are unable to reach a decision over one house in Sheikh Jarrah, reach an agreement over a radioactive suitcase?"

Also participating in the exercise was Kadima leader MK Tzipi Livni. The two have maintained contact since Halutz left the army. Some people there felt he was speaking to Livni, among others. The views he expressed place him squarely in the left-wing part of Kadima, if not Labor. Which raises a question: Wasn't he once Likud? Wasn't that why the "ranch forum" headed by Ariel Sharon and his sons chose him as chief of staff?

Nothing to regret

Last week, Ehud Olmert was the keynote speaker at an event commemorating the second anniversary of the death of businessman Benny Gaon. The former prime minister was warmly welcomed by the prominent business figures packing the foyer of the Einav Cultural Center in Tel Aviv.

Olmert delivered a riveting speech, articulate and knowledgeable, on political, economic and regional issues. He said that since he left office as prime minister 14 months ago, he has learned that the Palestinians regret not having accepted his offer for a peace agreement. He himself has described the offer as "more far-reaching than anything offered in the past."

MK Ahmed Tibi (Ta'al ) is the Israeli legislator closest to top Palestinian Authority officials, particularly President Mahmoud Abbas, who negotiated with Olmert, and Ahmed Qureia, who negotiated with Tzipi Livni, who at the time was foreign minister. Tibi was amazed by Olmert's remarks.

"I did not sense any regret among the Palestinians," he said this week. "The Palestinians say the negotiations with Olmert were serious. But they did not reach a conclusion, and no final offer was presented, so there is no reason for regret."

Olmert also noted that the Palestinians never turned him down - they simply did not get back to him. "That's true," Tibi said. "He showed Abbas a map, but would not give it to him. Abbas asked for time to consult with the Palestinian leadership. After that, events took their own course - Olmert went to war in Gaza - and afterward he lost power. In any event, I don't think a deal can be struck on the basis of his offer, because it did not come close to the minimum a Palestinian leader can accept."

Maybe Olmert heard that from Abbas or Qureia?

"No. He did not meet with either of them. I would have known. I assume that if the negotiations had continued, an agreement could have been reached. There is no doubt that in terms of his views about the Palestinians and Israel's Arabs, Olmert was the most progressive out of all Israel's prime ministers."

All of them?

"Absolutely. More than [Yitzhak] Rabin and more than [Ehud] Barak."

Two ideas

May 17 was the 23rd anniversary of the first Likud election victory, and to mark the occasion, the party's Knesset faction held its weekly meeting at the Menachem Begin Heritage Center in Jerusalem. The Kadima faction met at the same venue in March 2008, when the party was still in power, to mark the 16th anniversary of Begin's death.

Among those invited to the Likud faction meeting were the heads of local councils from Judea and Samaria. They hobnobbed with the MKs and ministers below a large sign reading "The difficulties of peace are better than the agonies of war" - as Begin said after he returned Sinai to Egypt. The head of the Ariel council, Ron Nachman, complained about the construction freeze in the territories, "We have never had such a terrible period," adding, "I don't know what will happen in another four months" - when the freeze is due to end.

"I know, I know," Netanyahu called out to him.

Netanyahu's aides are considering two still-vague ideas for September. One is a "differential settlement," according to which Netanyahu will announce that Israel will resume construction only in places where it will definitely retain sovereignty under any future agreement - that is, in the settlement blocs, and not in isolated settlements.

The other idea is more clever but also more dangerous: to announce publicly that construction is resuming, but to whisper to the Americans that the freeze will continue in practice. Maybe a tractor will clear some land here and there, for domestic consumption. That is the kind of solution that might give Netanyahu a few more months of quiet to reach an agreement or to let the Palestinians torpedo the negotiations.

These ideas are suggested to Netanyahu. He does not respond.

The unwanted

Alan DershowitzAmos Biderman

Netanyahu has been regaling recent visitors to his bureau with a story he heard a few days earlier from noted American lawyer Alan Dershowitz. Netanyahu tells the story with great enthusiasm; some ministers have heard it twice.

The background: an intimate dinner hosted by the prime minister and his wife for Prof. Dershowitz and his son, Gilad, about 10 days ago at the Prime Minister's Residence in Jerusalem. Dershowitz told Benjamin and Sara that when lecturing, he has made it a practice to ask those who consider themselves supporters of Israel, many of whom are naturally Jewish students, to raise their hands. He then makes a parallel request of the Palestinian students and their supporters.

He then asks the supporters of Israel to raise their hands if they favor the two-state solution. The vast majority raise their hands again. Then he puts the same question to the pro-Palestinian group. Initially there is silence, Dershowitz told his hosts. Then whispers break out within the group. At the end, when the noise fades, no one raises a hand.

Netanyahu views this little story through the prism of the narrative he learned in his father's home, which he wrote about in his books: "They" do not want us here, "they cannot be believed." Accordingly, he is convinced that any agreement with the Palestinians will have to be based on tough security arrangements that will prevent Iran and its satellites from entering the West Bank after an Israeli withdrawal. He has vowed that as long as he is prime minister, there will be no repeat of Lebanon 2000 or Gaza 2005. Israel will not withdraw from territory, just to be replaced by Hezbollah, Hamas or Al-Qaida.

Netanyahu does not talk about a future agreement in terms of patrimony, but in terms of security. All he hears around him is how much will be returned and what will be returned and the pace at which it must be returned. But, he asks, what will happen after we leave? Has anyone given thought to that? He believes history has placed him at the center of the decision-making process at this critical moment in order to restore sanity to the system.

Last Saturday night, Dershowitz told Channel 1 (Israel Television ) that he was considering Netanyahu's offer to become Israel's ambassador to the United Nations. A week earlier, he spoke at Tel Aviv University, where he was awarded an honorary doctorate. After his talk, the actor Alex Ansky told him, "You must be our next president." To which Dershowitz replied, "That's a job I won't turn down."

Haaretz.com, the online edition of Haaretz Newspaper in Israel, and analysis from Israel and the Middle East. Haaretz.com provides extensive and in-depth coverage of Israel, the Jewish World and the Middle East, including defense, diplomacy, the Arab-Israeli conflict, the peace process, Israeli politics, Jerusalem affairs, international relations, Iran, Iraq, Syria, Lebanon, the Palestinian Authority, the West Bank and the Gaza Strip, the Israeli business world and Jewish life in Israel and the Diaspora.